Spain's Socialists reelect hardliner Sanchez in leadership vote

MADRID (Reuters) - Spain's Socialists on Sunday choose former leader and hardliner Pedro Sanchez to head the party again, a vote likely to make it harder for the ruling conservatives to secure the opposition support it needs in parliament to push through legislation.

Sanchez has pledged to take a firm stand against the ruling minority People Party's (PP) market-friendly, deficit-tackling policies.

Sanchez will lead the Socialists further left and place them in direct opposition to the PP, increasing the possibility of a hung parliament over key reforms, something Prime Minister Mariano Rajoy has warned would trigger a new general election.

Sanchez was ousted last October after he refused to abstain in a vote to break a nine-month deadlock and avoid a third election following two inconclusive votes.

Once out, the Socialists stepped aside to allow Rajoy to reassume the PM's office, a position which infuriated many on the left even though a repeat election would have meant more Socialist votes lost.

The party has been left to prove its relevance in a split parliament that has pitched it between the right-wing policies of the PP and market friendly Ciudadanos (Citizens) on one hand and the hard-left Podemos (We Can) on the other.

FRACTURED AND STRUGGLING

The Socialists have suffered the fate of many of their left wing peers across Europe as electioneering has been distorted by populist leaders from all sides of the political spectrum, leaving its base fractured and struggling for an identity.

In Spain, part of that political sea change has been due to the arrival of the anti-austerity Podemos, which began as a grassroots movement against the PP's deficit-fighting policies during the prolonged economic crisis.

The latest polls place the Socialists slightly ahead of Podemos after loosing ground to the far left group late last year, though the conservatives remain firmly in front despite unpopular economic policies and a slew of corruption scandals.

"When the Socialists lost their profile as the alternative and became confused with their adversary, the electorate ends up not recognising it and going for more populist options," Sanchez campaign coordinator Jose Luis Abalos said.

On Friday, Podemos filed a motion of no-confidence against Rajoy, a move seen as a challenge to the Socialists to vote to fight the conservatives by their side in a leftist coalition they have until now resisted.